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23 Sep. 2010 | Comments (0)
- Engage with major shareholders – They suggest using a proxy adviser to determine just who those shareholders are, especially with the practice of shareholder lending.
- Determine gaps in board size and composition – They say to look for gaps in skill sets and factor in proxy access (shareholder nominees under Rule 14a-11) when considering the optimal size.
- Review bylaws and governance policies – Check for definition of majority voting, if necessary, how many directors it takes to call a special board meeting, confidentiality and the process for determining an authorized spokesperson. Also, look at advance notice bylaws and see if they need to be revised and whether or not director qualification standards need to be adopted.
- Be prepared and have internal and external teams in place – Such teams include legal advisers, financial advisers, proxy solicitors and a public relations firm.
- Rule 14a-11 is not applicable to the company
- Eligibility and procedural requirements of Rule 14a-11 were not satisfied
- The number of shareholder proxy access nominees exceeds the maximum permitted (25 percent of the sitting board)
- Within 14 days of the nominating deadline, the company must notify the nominating shareholder of a decision to exclude nominees or their supporting statement and state the reason.
- Within 14 days of the company’s notice, a nominating shareholder must respond and, if applicable, correct any deficiency. At this point, the nominating shareholder cannot change the group or nominees.
- No later than 80 days before filing the definitive proxy statement, the company must notify the SEC of its intent to exclude access nominees, with a copy sent to the nominating shareholder. The company may still seek a no-action letter.
- Within 14 days of receipt of the company’s notice to the SEC, the shareholder may submit a response to the SEC, with a copy sent to the company.
- Upon receiving a no-action response from the SEC, the company must notify the shareholder whether or not that nominee will included or excluded from company proxy materials. This should be at least 30 days before filing the definitive proxy statement.